Presented by Brian Leising This is the short-form life insurance needs analysis system I use with life insurance prospects and clients. The ten minute conversation achieves the same answers as an inch-thick comprehensive analysis, without the fancy full-color report. Here’s how it works: Ask your client to take a piece of paper and draw a vertical line down the middle. The heading on the left should be FIXED EXPENSES. The heading on the right should be ONGOING INCOME NEEDS. Start on the left. Everybody needs funds to cover their final expenses (casket, burial, cremation). Ask you client if they have any idea what that costs. Maybe they had a loved one pass away recently and know current expenses in your area. If not, I suggest $10,000-$20,000. Next, ask them to list all debts they would like to pay off upon death. The largest will be their mortgage if they own their home. Automobiles and credit cards should make up the remainder of the debts. If the client has children, ask how they plan to fund college tuition. If that is in their plans now, you can include an amount to cover that need in this column. You could use other resources (outside the scope of this article) to determine what future tuition may cost. You may want to revisit that portion at another time if time is a concern. Add up the numbers on the left column. Ask your client if all those things were paid off, would they be able to maintain their standard of living on the remaining spouse’s income? If they hesitate or are unsure, suggest that when one spouse passes away, the remaining spouse and children will need roughly 70% of the former combined income to maintain their standard of living. Usually they will need some additional income. We will take a look at those ongoing income needs in the right column next week.